ArcelorMittal to lay off 400 workers in Indiana

Pittsburg: ArcelorMittal SA, the world’s largest steel maker, plans to idle a US plant and lay off about 400 workers due to global economic turmoil that has dampened demand for the metal.

The Luxembourg-based company said Tuesday it will suspend operations indefinitely at the Indiana Harbor Long Carbon facility in East Chicago, Illinois. The plant is part of a larger facility that employs about 5,000 union workers and hundreds of nonunion workers. The layoffs of union and management workers are expected to begin in about 60 days.

The world economic crisis has hurt steel makers badly as consumers and steel-intensive industries rein in spending. ArcelorMittal said last week it would continue to freeze production while demand remains low for the metal used in everything from cars to buildings. It cut output by 45% late last year and planned to do the same early this year to reduce steel stocks.

The plant to be idled makes steel bar used in autos and heavy equipment. The larger Indiana Harbor works includes several other facilities, including blast furnaces and mills that will not be affected.

“The global economic downturn has caused a reduction in the demand for the company’s products,” ArcelorMittal said in a statement. “This indefinite closure and corresponding layoffs reflect measures the company is being forced to take around the world to adapt to the market’s situation.”

Jim Robinson, director of United Steel Workers District 7, said the union had been notified of the layoffs and that about 400 workers would be affected. An electric furnace and 12-inch bar mill will be idled, he said.

“Obviously, this is not a good situation,” he said. “Just another unfortunate reason we need to take every possible action to get this economy back up and running.”

As of 31 December, ArcelorMittal employed 315,867 people, with about 12% of them in North America.

Other steel companies have taken similar steps to cut production and lower costs during the recession. United States Steel Corp., the largest US-based steel company, has laid off thousands of workers since late last year, when demand and prices for steel plummeted.